More stable macroeconomic policy does not contribute to less variability in real output
a. True
b. False
Indicate whether the statement is true or false
False
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Assume that the elasticities of supply and demand in an industry are both equal to 2 and that it is currently untaxed. A new tax imposed on the industry will: a. be borne more by suppliers than demanders
b. be borne more by demanders than suppliers. c. be borne equally by demanders and suppliers. d. not raise any added revenue for the government since demand is relatively elastic.
A firm is using 50 units of labor and 100 units of capital to produce 2,000 units of output. The price of labor is $200 per unit and the price of capital is $100 per unit. At these input levels, another unit of labor adds 400 units to output and another unit of capital adds 600 units to output. The firm
A. is minimizing the cost of producing 2,000 units of output. B. could produce 6 more units of output at the same cost by switching $1 from labor to capital. C. could produce 4 more units of output at the same cost by switching $1 from labor to capital. D. could keep output constant and reduce cost by using more capital and less labor. E. both c and d
To protect depositors against bank failures, the federal government created which of the following in 1933?
a. Federal Reserve System b. Resolution Trust Company c. Federal Savings and Loan Insurance Corporation d. Federal Deposit Insurance Corporation e. Excess Reserve Insurance Corporation
If the expected future earnings of a company goes down, you would expect the price of its stock to
A. rise. B. fall. C. be unaffected. D. fall to zero.